Demand Outweighs Stock Offer At Cenit

Local investors wanted more stock than CENIT Bank for Savings had for sale in its multimillion-dollar stock offering that closed Tuesday, the investment banker who managed the deal said.

Although the final count won't be in for a few days, CENIT's offer of 1,075,000 shares of common was oversubscribed, said James C. Neuhauser, vice president of Raleigh, N.C.,-based Trident Securities Inc.

``People usually wait for the last few days, but demand has been very strong,'' he said.

Norfolk-based CENIT, which has a branch in Hampton, offered stock to raise capital for expansion. The sale will transform the 103-year-old mutual savings bank into a publicly held company, instead of one owned by its depositors.

The oversubscription means some of the investors who wanted stock may get fewer shares than they wanted, Neuhauser said.

Any extra money they sent in for the stock will be refunded, he said.

Depositors and employees have first priority in the allocation, while residents of the cities in which CENIT has branches have second call on the stock.

But before deciding on how to allocate the shares, CENIT will get an independent appraiser's report on the value of the stock, Neuhauser said. That report will set the final price of the shares, he said.

The stock offering is expected to raise between $9 million and $12 million, depending on the appraiser's report.

CENIT must also decide on whether to exercise an option to increase the number of shares on offer by 161,000, he said.

If the appraiser decides the stock is worth less than the $11.50 a share investors had to promise in order to buy stock, the excess would be refunded, but investors could also have the option of using the surplus to buy more stock, Neuhauser said.

Under the terms of the offering, the appraiser cannot value the stock at more than $11.50. CENIT has promised the stock would be priced somewhere between that ceiling and $8.50 a share.